Farm Savings Accounts

2018 Farm Bill: Farm Savings Accounts

Farm Bureau policy has supported Farmer Qualified Savings Accounts (FQSA) as a way to reduce the income risk that farmers face and provide an additional “safety net.” Such accounts encourage farmers to put money aside, allowing funds to be available when needed to mitigate financial risk and potentially help pay expenses during a farmer’s retirement years. These FQSAs have been discussed as an addition to current commodity and crop insurance programs and alternatively as a replacement for existing farm programs. The primary idea behind FQSAs is to encourage farmers to set aside funds in high-income years that would then be available to pay farm and family living expenses in low-income years.

The program could either be funded by giving farmers tax incentives or by using existing farm program funds and depositing them into farmers’ accounts. One concern with the tax incentive route is that lawmakers writing this legislation would not have a strong understanding of farm policy like the ag committee.

Advantages of a Farmer Qualified Savings Account:

FQSAs are not tied to specific crops and are available to all farmers.